NEW YORK, N.Y. – Stronger-than-expected financial results pushed Twitter’s stock sharply higher on Tuesday after the short messaging service said its revenue more than doubled in the second quarter.
Twitter also grew its user base more than expected, alleviating concerns, at least for now, that it doesn’t hold appeal for a broad swath of people. Its larger rival, Facebook, also posted strong results last week and its stock is trading near a record high.
San Francisco-based Twitter’s stock jumped 30 per cent to $50.01 in extended trading Tuesday.
Twitter Inc. posted a net loss of $144.6 million, or 24 cents per share, in the April-June period. That compares with a loss of $42.2 million, or 32 cents per share, a year earlier when Twitter was still a private company.
Adjusted earnings were 2 cents per share in the latest quarter, beating analysts’ expectations of a loss of 1 cent, according to FactSet. These numbers exclude stock compensation expenses.
Revenue was $312.2 million, up from $139.3 million thanks to help from new advertising tools Twitter launched in recent months, as well as international expansion.
Analysts polled by FactSet were expecting lower revenue of $283.3 million.
Mobile advertising revenue was $224 million, or 81 per cent of the quarter’s total ad revenue. In the first quarter, mobile ad revenue amounted to about 80 per cent of total ad revenue.
“Our strong financial and operating results for the second quarter show the continued momentum of our business,” said CEO Dick Costolo in a statement. “We remain focused on driving increased user growth and engagement, and by developing new product experiences, like the one we built around the World Cup, we believe we can extend Twitter’s appeal to an even broader audience.”
The service had 271 million average monthly users as of the end of June, up 24 per cent from a year earlier and up 6 per cent from the end of March. Analysts were expecting 266 million users. Facebook, in comparison, has 1.32 billion users.
“Timeline views,” which measure how often users refresh their own or someone else’s Twitter feed, increased 15 per cent year-over-year to 173 billion. This metric is also up 10 per cent from 157 billion in the first quarter. Twitter said it got a boost from the World Cup, the world’s most popular sporting event that took place over a month in June and July.
Advertising revenue per thousand timeline views, another closely watched measurement, reached $1.60 in the second quarter, double last year’s number and up 11 per cent from the first quarter.
For the current quarter, Twitter is expecting revenue of $330 million to $340 million, above analysts’ expectations of $323.7 million.
The company raised its revenue outlook for the year to between $1.31 billion to $1.33 billion. Its earlier guidance was for revenue of $1.2 billion to $1.25 billion. Analysts are forecasting $1.27 billion.
Twitter went public last November at a price of $26 per share. The stock peaked in December at $74.73 and then declined sharply. On Tuesday, it closed at $38.59 before the after-hours surge.